Guinness Nigeria Returns To Profit, Nets N2.13bn At Half-Year

Guinness Nigeria on Tuesday published its result for the half-year ended December 31, 2017, showing a return to profit, despite a lean growth in revenue and finance income and a marginal decline in finance cost and huge rise in tax expense.
Revenue from sales grew by N11.067bn or 18.6% from N59.49bn in the first half of 2016 to N70.557bn, the bulk of which came from Nigeria, its primary geographical segment; while cost of sales increased by a marginal N5.437bn or 13.22% to N46.562bn from the previous N41.125bn; resulting in gross profit of N23.994bn, up from N18.365bn in the corresponding period of 2016.
Other income dropped to N274.649m from N370.15m, with N192.808m being operating lease income, up from N109.497m, while sales of by-products dropped to N81.841m from N103.413m. Marketing and distribution expenses rose slightly to N12.883bn from N12.757bn, with marketing expenses accounting for N6.461bn, up from N5.54bn; but distribution expenses declined from N7.217bn to N6.421bn.
Administrative expenses fell to N4.737bn from N6.062bn, following which operating profit soared to N6.647bn from a loss of N84.668m.
Finance income increased slightly to N1.686bn from N1.535bn, the lion’s share of which was the N1.475bn gain on foreign exchange transactions; just as finance cost fell to N4.792bn from N6.113bn, the bulk of which was finance expense on loans and borrowings dropped to N769.265m from N1.739bn; interest expense on overdraft of N615.932m, from N622.926m; while interest expense on intercompany overdue debts and others dropped to N520.877m from N622.893m. Finance costs therefore dropped to N3.106bn from previous half-year’s N4.578bn.
Profit before tax stood at N3.541bn, from a loss of N4.662bn; while after tax profit stood at N2.13bn, from a loss N4.667bn, despite the significant rise in tax expense from N5.269m to N1.411bn. The profit translated to earnings per share of 97 kobo, as against 310 kobo.